Silicon Graphics Reports Q4 Loss

BOSTON (07/25/2000) - Silicon Graphics Inc. (SGI) on Monday reported a fourth-quarter net loss of $608 million or $3.21 a share, compared to net income of $158 million a year ago.

SGI reported a net loss for the full fiscal year of $830 million or $4.52 per share, compared to a profit of $54 million or 28 cents a share in the previous fiscal year.

Nine analysts polled by First Call/Thomson Financial had predicted losses between 15 cents and 22 cents per share for the quarter and 10 analysts polled estimated the company would report a loss of 54 cents to 68 cents for the year.

Those figures do not account for the charges in SGI's report, said a First Call/Thomson Financial spokesman.

The financial report includes various charges related to reserves on spare parts and inventories, as well as a deferred tax asset valuation allowance and residual U.S. tax.

Revenue was down for both the quarter and the year at SGI. Fourth-quarter revenue was $534 million, a 36 percent decrease from $828 million the previous year, while the year's revenue of $2.3 billion was 15 percent less than the $2.7 billion in the year before.

SGI also announced on Monday that it had hired Harold Covert as the company's new chief financial officer (CFO). Betsy Rafael, the previous CFO, left SGI in May. Covert had been CFO at Red Hat Inc.

Computer special effects firms like Industrial Light and Magic use SGI workstations and servers to produce effects in movies like "The Perfect Storm," "X-Men," and "Hollow Man."

SGI also produces commercial workstations and servers. The SGI Origin 3000 series servers and Onyx 3000 series workstations, released Tuesday, use a new modular technology that permits construction of small to large systems from a common set of building blocks, according to SGI.

SGI, in Mountain View, California, can be reached at +1-650-960-1980 or at http://www.sgi.com.

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